5. Investments in equipment and leases, net:

The Company’s investment in leases consists of the following (in thousands):


	Balance December 31, 2010		Reclassifications & Additions/ Dispositions			Depreciation/ Amortization Expense or Amortization of Leases			Balance December 31, 2011
Net investment in operating leases	$	8,820	$	379		$	(1,332	)	$	7,867
Net investment in direct financing leases		381		—			(125	)		256
Assets held for sale or lease, net		204		(51	)		—			153
Total	$	9,405	$	328		$	(1,457	)	$	8,276

Impairment of investments in leases and assets held for sale or lease:

Management periodically reviews the carrying values of its assets on leases and assets held for lease or sale. Impairment losses are recorded as an adjustment to the net investment in operating leases. No impairment losses were recorded during 2011 and 2010.

The Company utilizes a straight line depreciation method over the term of the equipment lease for equipment on operating leases currently in its portfolio. Depreciation expense on the Company’s equipment totaled $1.3 million each for the respective years ended December 31, 2011 and 2010.

All of the property on lease was acquired during the period 1999 through 2002.

Operating leases:

Property on operating leases consists of the following (in thousands):


	Balance December 31, 2010			Additions			Reclassifications or Dispositions			Balance December 31, 2011
Containers	$	20,038		$	—		$	(360	)	$	19,678
Transportation, rail		16,098			—			218			16,316
Marine vessel		4,333			460			—			4,793
Other		640			—			—			640
		41,109			460			(142	)		41,427
Less accumulated depreciation		(32,289	)		(1,332	)		61			(33,560	)
Total	$	8,820		$	(872	)	$	(81	)	$	7,867

The average estimated residual value for assets on operating leases was 10% of the assets’ original cost at both December 31, 2011 and 2010.

The Company earns revenues from its containers, marine vessel and certain other assets based on utilization of such assets or through fixed term leases. Contingent rentals (i.e., short-term, operating charter hire payments) and the associated expenses are recorded when earned and/or incurred. The revenues associated with these rentals are included as a component of Operating Lease Revenues, and totaled $2.5 million and $2.3 million for the years ended December 31, 2011 and 2010, respectively.

As of December 31, 2011 and 2010, the Company had no operating leases in non-accrual status.

Direct financing leases:

As of December 31, 2011, investment in direct financing leases primarily consists of railcars as well as construction and manufacturing equipment. At December 31, 2010, such investment primarily consists of manufacturing equipment.

The components of the Company’s investment in direct financing leases as of December 31, 2011 and 2010 are as follows (in thousands):


	2011			2010
Total minimum lease payments receivable	$	248		$	487
Estimated residual values of leased equipment (unguaranteed)		54			54
Investment in direct financing leases		302			541
Less unearned income		(46	)		(160	)
Net investment in direct financing leases	$	256		$	381

There were no net investments in direct financing leases in nonaccrual status as of December 31, 2011 and 2010.

At December 31, 2011, the aggregate amount of future lease payments is as follows (in thousands):


	Operating Leases		Direct Financing Leases		Total
Year ending December 31, 2012	$	1,679	$	200	$	1,879
2013		544		48		592
2014		287		—		287
2015		179		—		179
2016		179		—		179
Thereafter		254		—		254
	$	3,122	$	248	$	3,370